Hana Financial Group Reports Q1 Net Profit of KRW 1.1277 Trillion, Up 9.1% Year-on-Year

Interest Income Reaches KRW 2.2728 Trillion; Fee Income at KRW 521.6 Billion
Hana Bank Reports KRW 992.9 Billion, Up 17.8% Year-on-Year

Hana Financial Group's net profit for the first quarter of this year increased by 9% compared to the same period last year. Despite heightened uncertainty in domestic and international financial markets, the group's core earnings, including interest income, grew, leading to improved performance.

On April 25, Hana Financial Group announced through a regulatory filing that its consolidated net profit attributable to controlling interests for the first quarter of this year was KRW 1.1277 trillion, a 9.1% increase from KRW 1.034 trillion in the same period last year. While this figure falls short of the record quarterly profit of KRW 1.1566 trillion posted in the third quarter of last year?since the merger of Hana Bank and Korea Exchange Bank in 2015?it marks the highest first-quarter profit in the group's history. It also exceeded the consensus estimate from the securities industry, which was KRW 1.062 trillion.

A Hana Financial Group representative stated, "We achieved results that surpassed market expectations, driven by the expansion of our customer base, diversification of our earnings portfolio, company-wide cost efficiency, and proactive risk management."

Hana Financial Group's interest income for the first quarter was KRW 2.2728 trillion, up 2.3% year-on-year. Core earnings, which include fee income of KRW 521.6 billion, totaled KRW 2.7944 trillion, representing a 2.2% increase over the same period. The net interest margin (NIM) was 1.69%, down 0.08 percentage points from the first quarter of last year.

Fee income improved by 1.7% (KRW 8.8 billion) year-on-year, thanks to diversification of the earnings portfolio, including: increased foreign exchange fees from expanding export-import customers; a broader base of recurring fees from operating leases and retirement pensions; and higher credit card fees due to increased overseas spending.

By subsidiary, Hana Bank’s net profit for the first quarter was KRW 992.9 billion, a 17.8% increase from the same period last year. Interest income was KRW 1.9359 trillion, and fee income was KRW 249.6 billion, bringing total core earnings to KRW 2.1855 trillion. The first-quarter NIM was 1.48%, up 0.02 percentage points from the previous quarter but down 0.07 percentage points from the same period last year.

Non-interest income was KRW 330 billion, a 41.9% increase year-on-year. The group explained that this was due to the diversification of the earnings base, achieved through synergies among the bank’s core business areas such as corporate finance, foreign exchange, and wealth management.

In the first quarter of this year, Hana Securities posted KRW 75.3 billion, Hana Card KRW 54.6 billion, Hana Capital KRW 31.5 billion, Hana Asset Trust KRW 17.6 billion, and Hana Life Insurance KRW 12.1 billion.

The group’s common equity tier 1 (CET1) ratio for the first quarter is expected to be 13.23%, up 0.34 percentage points from the same period last year. The estimated Bank for International Settlements (BIS) ratio was 15.68%.

Hana Financial Group has fixed its total annual cash dividend at KRW 1 trillion for this year and introduced equal quarterly dividends. Accordingly, the group’s board of directors has resolved to pay a quarterly cash dividend of KRW 906 per share.